Thursday, October 27, 2011

Unclaimed Property News Roundup

Unclaimed Property Down Under -- The Sydney Morning Herald is reporting that the Australian Securities and Investments Commission is holding A$ 636 million in unclaimed funds arising from forgotten bank accounts, unpaid life insurance benefits, and dormant securities payments.  More information can be found on ASIC's website here.

Massachusetts Unclaimed Property Auction -- Boston.com is reporting that the Massachusetts Unclaimed Property Division is going to hold an unclaimed property auction on eBay to sell tangible property the Division has collected, primarily from unclaimed safe deposit boxes.  A similar auction last year raised nearly half a million dollars for the Commonwealth.  Among the items up for auction are a $25,000 diamond necklace and a "broken Harry Potter wristwatch."

Tuesday, October 25, 2011

Delaware Keeps AAA Credit Rating With Other People's Money

While the broader U.S. economy continues to ebb and flow, some are warning of another possible downgrade of the national credit rating.  Some other governments, however, are not having credit rating problems during these difficult times.

According to a press release on Marketwatch.com, Fitch Ratings assigned a AAA rating to Delaware's latest $275 million bond offering.  Among the factors that Fitch relied upon in making its determination to provide its highest rating was Delaware's revenue profile (that is, the sources of revenue brought in by the state, and the likelihood that those revenue streams would remain sufficient to discharge the state's bond obligations).  Given Delaware's status as a popular state of incorporation for domestic companies, its no surprise that unclaimed property revenue makes up an important slice of the First State's revenue mix.  As Fitch noted:
Delaware's revenue mix reflects its position as legal home of most U.S. corporations, with various fees and taxes as well as abandoned property revenue all linked to companies being legally domiciled in the state. Abandoned property typically accounts for 10% to 12% of general fund revenues though collections were a high 15% in fiscal 2010; this variable revenue stream has been negatively affected by the downturn in financial markets but the state's decision to shorten the dormancy period on held securities has resulted in an increase in these collections.

Monday, October 24, 2011

Better Business Bureau Warns of Unclaimed Property Scam (via LA Times)

The Money & Company blog of the Los Angeles Times recently posted a warning concerning online scams.  Along with a faux-Facebook contest with a one million dollar prize and some mortgage foreclosure chicanery, there is also one of the usual unclaimed property scams.  According to the article, the fraudsters are sending emails to recipients informing them that "millions" in unclaimed property are being held for their benefit.  The scammers then ask for bank account, credit card, SSN and other personal financial information.

We've said it before, but it bears repeating:  legitimate unclaimed property regulators will not contact you via email.  If someone contacts you claiming to have unclaimed property in your name, you needn't respond by sending an email to unrecognizable address, visiting a potentially false website, or calling an unidentified 1-800 number.  You can go to the website of the National Association of Unclaimed Property Administrators (www.naupa.org) and find claiming information for your appropriate state.

Thursday, October 20, 2011

Even Hospitals Need An Unclaimed Property Checkup

Beckers Hospital Review has an article by Bob Herman entitled "5 Common Accounting Blunders Hospitals Can Avoid."  Though the article is intended for those in the healthcare field, much of the advice -- such as not letting credits accumulate or making sure to stay up to date on accounting guidelines -- are useful for nearly all companies.  The article also specifically mentions unclaimed property -- in the context of allowing uncashed checking to accumulate -- and warns of the expense and disruption attendant to unclaimed property audits.  Notably, the article also warns companies against allowing credit balances to accumulate.  Although that is presented in the context of making sure payment procedures and processes are accurate, accumulated accounts receivable credits are a favorite target of unclaimed property regulators in the audit context.

Tuesday, October 18, 2011

The Check Is In (or for) the Mail

The Inspector General of the U.S. Post Office has an audit program to collect unclaimed funds held by state governments for the benefit of the postal service.  The purpose of the audit is to "to determine whether the postal service efficiently and effectively collects unclaimed funds held by state treasuries."  If the postal service is like most companies, the answer is probably not, but we wish them luck.  The audit description also contains some tips for postal service employees to prevent funds from going unclaimed.  They are good suggestions for any company:

1.  Deposit checks without delay
2.  Be responsive to refunds
3.  Respond to notices from holders of property
4.  Respond to requests for confirmation of account balances
5.  Instruct customers to make checks payable to "US Postal Service"

(On second thought, you might want to skip this last one unless you're the post office).


 

Monday, October 17, 2011

Unclaimed Property News Roundup

A few miscellaneous unclaimed property articles to start the week:

South Dakota Holding Nearly $5 Million in Unclaimed Lottery Winnings -- According to an article by Megan Luther in the Argus Leader of Sioux Falls, South Dakota, that state is currently holding more than $4.8 million in unclaimed lottery winnings.  According to the article, winners have 180 days to claim prizes after which time the money reverts to the state.

California Controller's Office Issues Quarterly Unclaimed Property Newsletter -- The Holder Outreach program of the California Unclaimed Property Division recently issued their Quarterly Holder Newsletter.  Among the topics covered in the newsletter are the state's procedures for assessing interest on late reported amounts, a reminder about due diligence, and the latest holder reunification stats.

Unclaimed Property Claim Activity Increases in Ohio -- According to the Associated Press, Ohio is reporting that nearly $15 million has been claimed from the Department of Unclaimed Funds to date, and increase of more than 35% over the same period in 2010. 

Friday, October 14, 2011

Unclaimed Property Audit of Philadelphia Sheriff's Department Uncovers $50 Million

Back in February, we mentioned an investigation of unclaimed property held by the Philadelphia Sheriff's Office.  According to Philly.com, the Sheriff's Department had not filed an unclaimed property report with the Commonwealth of Pennsylvania since at least 2006, despite having reported and remitted approximately $5 million during the period from 2002-2005.  The majority of the unclaimed funds held by the Sheriff's office are excess proceeds from foreclosure sales and other auctions.  As anyone who has been following the economy knows, the amount of foreclosures has markedly increased since 2005, and accordingly, one would expect the Sheriff's office to have even more unclaimed property arising from foreclosure sales.

According to WHYY's Newsworks blog, the authorities have now completed a multi-month audit of unclaimed funds held by the Department, and have discovered approximately $50 million in unclaimed funds that should have been reported and remitted to the City and the Commonwealth for the benefit of the rightful owners.  No word on whether any civil or criminal charges will be filed in connection with the findings

Thursday, October 13, 2011

Mini Escheat Departments, Part II - Unclaimed Child Support Payments

On Monday, we posted an entry about unclaimed property being held by government entities other than the state unclaimed property agencies -- in particular, municipal and county governments.  Following up on these "mini escheat departments," ABC's Good Morning America posted an online article about yet another source of unclaimed funds -- unclaimed child support payments.  In many places, a child support payor is required to make payments directly to a state or municipal agency.  As a result, if the receiver moves and does not notify the child support agency of a new address, the funds can go unclaimed. 

The GMA article has links to child support agencies in some states and major metro areas, as well as other information on how to claim these funds.

Monday, October 10, 2011

Mini Escheat Departments at Lower Government Levels

Most unclaimed property professionals are aware that every state keeps a list of unclaimed property so that owners can claim their funds.  What is less well known is that certain other government entities (e.g., counties, cities, etc.) do likewise.  Generally, the items held by these agencies are (no surprise) money held by these agencies for the benefit of others.  For example, Orange County, California lists on its website, unclaimed estate and landlord sale proceeds held for the benefit of rightful owners.  The same with Milwaukee County, Wisconsin, San Diego County, California, Cuyahoga County, Ohio and hundreds of others.  So, if you are trying to undertake a comprehensive search for missing money, don't let your searches stop at the state.

Tuesday, October 4, 2011

Florida Unclaimed Property Action Nets More Than $1 Million for Public Schools

We have spent a few posts here talking about unclaimed property auctions.  And, to be honest, we've also spent some time in this space making fun of some of the items that are available for auction.  That being said, unclaimed property auctions do serve a very serious, and very useful, service.  For example, according to the South Florida Sun-Sentinel, Florida's recent unclaimed property auction raised over $1 million that will be used to fund local schools. In the current economy, and in light of the budget difficulties that many states face, every public dollar is important.

In the event you are a Missouri reader interested in unclaimed property auctions in the Show-Me-State, the Missouri Department of Treasury is holding an unclaimed property auction today in Columbia, MO.  Among the items available for auction is the autograph of the "Wizard of Oz." (this one, not this one).

Monday, October 3, 2011

$78 Million in Found Money Returned in Japan

We often post articles in this space about the efforts of governments (and sometimes private individuals) to reunite owners with their money.  Often, these efforts are mandated by law, and involve thousands of dollars.  That being the case, we were astounded by the ongoing efforts in Japan arising from that country's recent natural disasters.

According to an article in the Los Angeles Times, Japanese firemen, police officers, rescuers, and private citizens have found, and returned, an astounding $78 million dollars in currency that was found in the wreckage caused by the earthquake and tsunami. In light of the more than 25,000 people who were lost as a result of this tragedy, most of the money will likely go unclaimed (in which case, according to the article, the money will become the property of the government).  Even so, in a time where we are often confronted by story after story of those who seek to capitalize on tragedy, the article provides a welcome reminder of the honesty and decency of many.